STOCKHOLM (Reuters) - Sweden's Autoliv <ALV.N>, the world's largest producer of airbags and seatbelts, forecast on Tuesday an upturn in underlying sales growth in 2020 as it reported fourth-quarter earnings that beat market expectations.
While the car industry spent 2019 in a deep slump, hit by soft demand and mounting investment in electric and self-driving technology, Autoliv managed to keep growing on the back of years of order wins in the wake of the collapse of its former rival Takata, now a part of Joyson.
The slump still saw Autoliv cut financial guidance repeatedly and embark on a plan to trim annual costs, axing hundreds of jobs in production as well as in areas such as sales and R&D.
The automotive supplier, whose stock is listed in both the United States and Sweden, said it expected organic sales - excluding acquisitions, divestments and currency moves - to grow 3-4% this year versus 1.2% in 2019, with its adjusted operating margin reaching at least 9.5%, up from 9.1% last year.
Refinitiv estimates showed analysts on average forecasting a 10% margin for 2020. Autoliv last year set a target of lifting its margin to 12% and to outgrow global light vehicle output by 3-4% organically over the coming 3-5 years.
"The start of the year will be challenging but we expect a significantly stronger second half year," Chief Executive Mikael Bratt said in a statement.
Autoliv's outlook assumed a further 2-3% fall in global light vehicle output this year after a drop of close to 6% in 2019 and Bratt told Reuters it was too early to call when production would bottom out.
Fourth-quarter adjusted operating earnings at Autoliv rose to $242 million from $240 million a year earlier, beating the $230 million seen by analysts, according to Refinitiv estimates.
Sweden-listed shares in Autoliv <ALIVsdb.ST>, which competes with ZF TRW as well as Joyson Safety Systems, were up 3.1% at 1142 GMT, trimming losses this year to 7%.
(Reporting by Niklas Pollard; editing by Johannes Hellstrom and Mark Potter)